Exam 6: Cash and Internal Control

Match the action with the category of internal control procedures -Design and use of business documents

If the balance on the bank statement does not equal the balance in the cash account, then it can be assumed that:

Administrative controls

Which of the following is not a requirement of a company's external auditors under Sarbanes-Oxley?

The following set of items describes activities completed by a company in purchasing and paying for merchandise.For each activity, identify whether or not the activity adheres to or violates sound internal control procedures. The clerk in the accounting department records both purchases and payments of invoices.

The debit balance in Cash Short and Over at the end of an accounting period is reported as

In the reconciliation of a bank statement, "deposits in transit" should be: A) added to the unadjusted book balance B) subtracted from the unadjusted bank balance C) added to the unadjusted bank balance D) subtracted from the unadjusted bank balance

If receipts from cash sales of $7,500 were recorded incorrectly as $5,700 in the company's books, then this item would be included on the bank reconciliation as a(n)

Checks received from customers are considered to be cash in the company's books.

Allowing only certain employees to order goods and services for the company is an example of what internal control procedure?

Deposits made by a company but not yet reflected in a bank statement are called

Use the following data to answer the question presented below for Raines Corp.'s preparation of a bank reconciliation on October 31, 2016: ? Bank statement balance \ 30,700 Raines' book balance (before adjustments) ? Outstanding checks 4,200 NSF checks 400 Service charges 300 Deposits in transit 3,100 Interest earned on checking account 100 ? What is the net amount of the increase or decrease in Raines' cash balance which must be recorded as a result of the adjustments identified by the bank reconciliation?

Checks presented for payment and paid by the bank are known as

Having only one person authorized to both prepare and sign checks is a violation of what internal control procedure?

The following set of items describes activities completed by a company in collecting cash for merchandise sales.For each activity, identify whether or not the activity adheres to or violates sound internal control procedures. An employee in the accounting department records cash receipts from customers and prepares a bank deposit slip.

The key to the classification of an amount as cash is that it be readily available to pay debts.

Sarbanes-Oxley requires that the audit committee be composed of

The following set of items describes activities completed by a company in purchasing and paying for merchandise.For each activity, identify whether or not the activity adheres to or violates sound internal control procedures. Checks are signed by designated officers in the finance department.

__________________ is a report required by section 404 of the Sarbanes-Oxley Act.

Which one of the following is considered one of the six most important categories of internal control procedures?